07 Oct 2021



  • In September 2020, AIM launched an exciting cross-value chain initiative under the name “HolyGrail 2.0”. Could you introduce the initiative to our readers and give us some insights on how this project emerged?

The Digital Watermarks Initiative HolyGrail 2.0 – driven by AIM - European Brands Association and powered by the Alliance to End Plastic Waste – is a pilot project with the objective to prove the technical viability of digital watermarks for accurate sorting of packaging waste as well as the economic viability of the business case at large scale.

As the name suggests, HolyGrail 2.0 is not the beginning of the story. The digital watermarks project was part of the broader pioneering project HolyGrail 1.0 which, facilitated by the Ellen MacArthur Foundation from 2016-2019, investigated different innovations in the field of improving post-consumer recycling. Digital watermarks were found to be the most promising technology, gathering support among the large majority of stakeholders. That’s why the branded goods industry, under the auspices of AIM – European Brands Association, stepped in one year ago to facilitate HolyGrail 2.0 as a cross-value chain initiative to bring the digital watermarks technology to industrial scale trials.

  • Why is the HolyGrail 2.0 ground-breaking for the packaging industry and the green transition?

The HolyGrail 2.0 initiative assesses digital watermarks for smart packing aiming to revolutionise the way packaging is sorted and opening new possibilities that are currently not feasible with existing technologies.

Digital watermarks are imperceptible codes, the size of a postage stamp, covering the surface of a consumer goods packaging. They are able to carry a wide range of attributes (e.g. manufacturer, SKUs, type of plastics used and composition for multi-layer objects, food vs. non-food usage). The aim is that once a packaging has entered a waste sorting facility, the digital watermark can be detected and decoded by a high resolution camera on the sorting line, which then – based on the transferred attributes (e.g. food vs. non-food) – is able to sort the packaging in corresponding streams, thus, enabling sorting processes that are not yet possible today with near infrared (NIR) technologies. This would result in better and more accurate sorting streams, thus consequently in higher-quality recyclates benefiting the complete packaging value chain and contributing to a truly circular economy for packaging.

  • What are the biggest challenges the initiative is/could be confronted with?

Next to the technical viability of digital watermarks, we are also looking into the economic viability and the potential business cases. Investments need to be done by two value chain parts:

First, brand owners and retailers need to change the artwork of their packaging encoding it with digital watermarks. The main challenge for a full scale implementation of digital watermarks for intelligent sorting is the market acceptance of the digital watermarks technology for different packaging types by the brand owners and retailers. That is why specific work packages within HolyGrail 2.0 address the technological and esthetical concerns of packaging producers for digital watermarks in print and for mold. Esthetical aspects of the packaging, such as shelf appeal, is crucial for brands and retailers. In this context, the initiative will release a public summary report on best practices for digital watermarks.

Second, the waste industry (Materials Recovery Facilities (MRF), Plastic Recovery Facilities (PRF), recyclers) would need to invest in add-on modules for their detection sorting units that could be easily mounted onto and used in combination with existing NIR sorters. Overall, waste management operators can expect a general increase of product quality, by e.g. identification of PET trays suitable for recycling, identification of multilayer packaging, identification of packaging material covered by sleeves and sorting of "inked material". In addition, MRF/PRF operators may reduce the number of NIR sorter modules in their facilities due to this new technology.

  • What are the latest developments within the HolyGrail 2.0 initiative?

The Digital Watermarks Initiative HolyGrail 2.0 has reached its first milestone with the successful validation of the project's first prototype detection sorting unit. Developed by the machine vendor Pellenc ST and the digital watermarks technology provider Digimarc, the prototype, which combines the digital watermarks technology and NIR/VIS infrared for sorting of packaging waste, achieved a >95% ejection rate. This sorter is now being installed in the Amager Resource Centre (ARC) in Copenhagen to start the semi-industrial test phase.

Furthermore, we have also just announced our two new partnerships for the initiative. The Alliance to End Plastic Waste has joined us as key partner to drive the project. With the City of Copenhagen we are delighted to have another precious partner for the semi-industrial test phase on board.

Last but not least, our membership has nearly doubled since the project’s launch in September 2020, with currently more than 130 companies and organisations from the complete packaging value chain. All of this is complemented by our growing HolyGrail 2.0 Advisory Group including key stakeholders in the Circular Economy debate, such as WWF and the Ellen MacArthur Foundation.

  • What can we expect next?

Over the next four months, trials and demonstrations with around 125.000 pieces of packaging representing up to 260 different stock-keeping units (SKUs), all prepared by HolyGrail 2.0 members, will be held at the Amager Resource Centre (ARC) in Copenhagen. Engineers will test for several parameters including the speed and accuracy of the system, to ensure its ability to withstand the pressures of full-scale industrial operations. At the same time, a second prototype unit with the machine vendor Tomra is under development. If successful, digitally watermarked products could be introduced to store shelves in Denmark, France and Germany by the first half of 2022 for in-market demonstrations and industrial-scale trials.

The results that will be achieved within the (semi-)industrial trials and published in a final techno-economic analysis report will reveal whether the packaging value chain can scale up digital watermarks on packaging for improved sorting and really get this technology to where it needs to be. A successful demonstration of the technical and economic viability of the technology would inspire more countries and waste management operators to implement this new sorting technology.

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